ML20126F351

1984 Annual Rept

ML20126F351
Person / Time
Site:	Trojan File:Portland General Electric icon.png
Issue date:	12/31/1984
From:	Pratt C EUGENE WATER & ELECTRIC BOARD
To:
Shared Package
ML20126F325	List: ML20126F321 ML20126F341 ML20126F351 ML20126F358
References
NUDOCS 8506170444
Download: ML20126F351 (36)

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(thousands ofdollars) 1984 1983 1982 1981 FortheYear Gross Operating Revenues 62 114 - 59 500 -57 076 49 222 Net Operating Revenues -1 516 10 487 10 425 10 343

- Net Revenue 2 978 12 274 .13 190 10 912 Capital Expenditures 4 550 7 451 3 933 6 477 AtYearEnd Net Working Capital . 20 875 20 489 19 793 8 930 Lor.g-Term Debt . 24 424 26 414 28 199- 31 038 Retained Earnings 116 619 113 641 101 368 88177 ~

1984 1983 1982 1981~

FortheYear

- Gross Operating Revenues 6 220 6 096 6 542 6 042 Net Operating Revenues 1 238 1153 1 819 1 701-Net Revenue 434 . 68 882 981 Capital Expenutares 750 579 1 189 1 760 AtYear End Net Working Capital 1785' 1353 1 207 853 long-Tenm Debt 12 430 12 895 -13 344 14 008 Retained Earnio.p 15 014 14 579 14 512 13 630 Standard & Poor's Moody'sInvestors Corporation ' Service Electric Utility System Revenue Bonds AA+ Al Water titilitySystem Revenue Bond. . AA 'Al Trojan Nuclear Project Revenue Bonds AA Al Eugene Water

& Electric Board 500 East Fourth Avenue P.O. Ikix 10148 Eugene, Oregon 97440 (503)484 2411

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't 4 !t 'INvo of Eugene s ( >utstanding citizens i 1 retired from public service at the end of lh The leadership of John Tiffany. President of the Eugene Water & Electric Iloard for l~ vears, and of Keith Parks, EWEB General N1anager fi>r 11 vears. has been a tremendous beneht to both the utility and the community. Their wisdom and direction helped EWEll continue its high standards for service during a period of many difficult challenges.

N1r. Tiffany and Nir. Parks will he missed iIowever, EWEll continues to have a talented and accomplished lloard and management team. Followmg mv six years as Vice President of the Board, I am honored to succeed Nir. Tiffant as President The five Commissioners--including newiv elected Board mem-her 1)r. James Reinmuth,1)ean ( >f the University of Oregon School ofIlusiness Administration-have a combined 20 veai s of Board service and f rom two to four vears remaining in their terms (>t office therchv assuring stable and ex-perienced leadership Jean Reeder, previousiv Assistant General Nianager, has been app (>inted Acting General Nianager. Iler seven years (>t service at EWEB have been filled with accomplishment, including developing EWEB's suc-cessful conservation programs. The four division directors-1)on Vander-zanden, Garry Kunkel, Rosemary Edwards. and Ken Rinard-have from F to

% years ( >f service at EWElt I)uring mv cight vears on this Board. EWEB has dealt with numerous major problems and decisions. Niant of these have been in response to federal leg-islation and to actions by the Bonneville Power Adminstration. The Board's active interventi( >n on behalt (if the customers has resulted in a strengthening of our commitment t( > preserve what has been the kev to EWEB's success for

~1 vearx Independent l(> cal c(>ntr(>l. Because the B< >ard is elected to best represent the utility's cust(>mers, we are working t(> assure excellent utility service while pr( >tecting cust( >mers in >m higher rates. greater hureaucract or reduced efficiencv.

Through the vears. EWEB has developed a reputation f, >r sound leadership and management With the B< >ard's strong sense of purpose, the expertise of the management teilm and the dediCati()n < )Idll empl() vees. Eugene 5 muniCi-pal utility will meet the opportunities ahead with confidence.

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Camilla Pratt, President < >f the B( >ard I

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. l' F( >ll( > wing niant years ( >ti >ut- .h I standing (( >nlinunity leadership, Eugene Water &

Electric lh)ard President It >hn Tiltant [uld General --

g j Nianager Keith Parks retired fr(>m Ew Eli service on -- r-__

j I)ecember 31,1981 The 1985 Ik )ard of 0 )nintission-

• ers pn >udlv dedicate this Annual 1(eport in honor of these two great public servants Z-m John A. Tiffanv was app (>inted an Ew Ell Coninlis- _p

• mw si()ner on June 20.1962 and went (in to serve for 22' 2 h,

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vears ( >n the lh >ard, the l(>ngest tenure in Ew. Ells his-t( nr Nlr Tiff ant served as Vice President of the 130ard M ,

for three vears hetiire becoming Ik >ard President in _e januarv 1968, the position he held for l~ vears until the t_

-, c(>mpletit in (>t his fif th and final term ot'(>ttice. Chair- h- _

man of the Ik )ard ( >f Tiff anv-l) avis 1) rug C( >mpant, Nlr. N Tittant was named " Eugene s First Citizen" hv the ~Y Eugene Chamber of Commerce in cariv 1985 W 7

A, ul Pa k' Keith Parks' public-service career spanned 38 =

\ Cdl s. IIC altalllC t le I()p nlallaheInClit f(Isktk(In at ,_

l.ane C( >unts prior tt > inining EWEI3 in 1908 as Assistant t( > the (ieneral .\lanager lie was named EWEll Assis-3-

Q-tant (iencral N1anager in 19~3 and app (>inted General -Q N1anager Secretart ()n J.inuan ~ 19~ 1. M M

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, Eugene is Oregon's i c$rd. C ,, ', .  ; " .. [ .. y.

. $ I ^ -~ U ~> r b" - J.C '" ' ' ' '

& wcond largest urv. haung 6 M@

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c_u m n s+. s 6g a populanon of more than I t% s. y- ., g .Y(g[; g .?g:L,,

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,J r,,p& ,i vnn) ms ha, not osh grow n u ith the mmmunits, I

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but has helped it to grow b3 prouding excellent electric, 4,' f.

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water and steam seruce at u=-( " yfi f

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s EWEl3 is more than a utility. It i.s

, an integr.ll part ()t the oininlunity. helping l promote a better quality of lite Iw assuring an l aniple and reliable energy and water suppiv. Iw helping oinsunlers in-l Crease the ettiCienCv ()t' use. In pro \ iding responsive personal service

llld lw licepillg o ) sis di)% !).

Iteing .1 publiCl) ()wned utility. EWEll and the oimmunitt it serves l1.tve a Clt )se ht )lld. Ille Cili / ells estilhlished EWEl$ ~ l \ cars ag() heCause thc\ wanted the unlitt services ti > he ()perated st )lely it ir their benefit. To

.lssttre that tlle titilit\ 's till.IllCes u t illld llt it he tised it )r nt ill utilitt ptir-p(1ses, tlle (Iitt (It )tillCil itillled ()\ er o )llin >l t it'[Ile IllllillCip;ll witter .ind electrlC I.lCilities in l')] l it ).In independent Ih Mrd ()! Ih e Eugene Citi/ ens.

Ilie Illissit )ll ()! tlie l') ( (illlillissit )llers wht ) h.l\ c sillCe ser\ ed t >ll 1lle lh ).11 d h.ls lle\ cr Ch.lilged: 'l'R A ide eNCellent servlCe .it le m (()sl.

Dromoting prosaerity Eugeneis 1 a very nice place to live. T le area s natural beauty, mild climate and countless recreation opportunities combine with the cultural, educational and com-mercial benefits of metropolitan living to establish Eugene as a city where people want to stay.

m . . . . . . - . .

There has been one major con-m; .. .

g~ cern, however. The recession and

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high interest rates cut deeply into

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the forest products industrywhich

. provides nearly one-eighth of the

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county-wide employment. Eugene's size and diversity have helped it EMEO7"e'O";Os%"i weather the economic hardship better than many MXCWZggML*C communities. Yet it is clear that Eugene must further g y n m oxi.minemmnrrort"8e"<* broaden its economic base and seek new business and industry ifit is to add prosperity to the list of the community's accomplishments.

Toward this goal, the Eugene-Springfield Metro-politan Partnership, Inc. has been formed by the neighboring communities' city governments, cham-bers of commerce and the county government to promote the area as being " Fit for Ilusiness." In addi-tion, a 13usiness Assistance Team is actively working to provide support for local businesses in their ef-forts to expand operations.

The cost, availability and reliability of electric and I water services are significant considerations to busi-nesses looking for new locations, and for existing businesses planning to expand their operations. In this arena, EWEI3 provides the community with a distinct marketing advantage.

2 Eugene \nter & Electric Ikurd Anntul Report

Better b IzEWEB.,

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5 designed to serve existing and new customers at high standards of reliability.The utility's engineers continually analyze system "J2C"'"OL',"y"L performance along with plans and forecasts *'"*""*""*

for community development to assure that adequate facilities are in place to reliably serve the customers. The result is an elec-tric system that can be counted on during a frigidJanuary night and a water system that

meets all needs-including fire protection

-during an August heat wave. In addition, the systems are ready to serve new develop-i ments without compromising the reliability or sen* ice to existing customers.

The performance of EWEB's systems has been superb. By " looping" the transmission and feeder power lines so loads can be served from alternate sources, and by having muhiple systems for the pumping, treatment and storage of water, EWEB customers have become accustomed to dependable service.

l l

l Commitment to the Community 3

Qupplying the future The nacitic d Northwest currently has a surplus of electric generating capability. As long as the region con-tinues its commitment to developing the energy .

I conservation resource, that surplus could last for many more years. In addition to getting power from regional resources, EWEB owns three hydro-t a electric projects on the McKenzie River which provide about one-fifth of the community's q electricity supply. These resources help save y l money for all of EWEB's customers in two l ways. First, the projects generate electricity i

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at low cost. Second, they provide operating flexibility, giving EWEB the opportunity to better control its purchased power costs.

EWEB is continuing to pursue options for future re-newable resource development which would en-hance the utility's self-sufficiency and cost advantage.

EWEB has always provided a plentiful water sup-ply for Eugene. Major improvements to the water system in the late-1970s expanded the filtration, transmission and storage capability. This expansion was designed not only to raise the reliability of the water system to meet existing customer demand, but also to allow EWEB to readily serve new residen-tial, commercial and industrial water needs. In addi-tion to being plentiful, EWEB's water is of superb quality. The purity is proven through continuous monitoring and testing at the Ilayden Bridge Filtra-tion Plant and throughout the water system. EWEB's water easily exceeds all standards for quality.

4 Eugene Oter & Ikttric th uni Anntul Re[mrt

,rg , rsow do we rate? avEB has not -- -

1 1. raised electric or water rates for more than '

two years.

EWEB has been successful in holding the line on a rates by controlling operating costs and capital ex-penditures, and by utilizing cash reserves to absorb so much higher costs for wholesale power from the Bonneville Power Administration. In 1984 alone' /

x=v rare mae- w o-Ikmnenlle IN>wer Adminis-EWEB,s payments to Bonneville increased by $11 tration have lud a dramatic million to total more than $30 million.

• E"TUl"i Z""'"

EWEB's electric rates continue to average less than three cents per kilowatt-hour to all classes of cus- E",'CI'o"",','

tomers. The federal Energy Information Administra. O Othe, tion reports that EWEB's rates for large commercial 5 Si and industrial customers ranked from second to fourth lowest nationwide in 1984, depending on the size of the customer load. A study by Peat, Marwick, Mitchell & Co. showed EWEB's residential rates to be the third lowest among 105 major U.S. cities.

Water is one of the Jegst expensive commodities to buy. For the same prite as a quart of milk, EWEB de-livers more than 1,000 gallons of purified water to the consumer's tap. EWEB's water rates have not changed since February 1982 and are lower than most major Northwest cities.

Commitment to the Community 5

1. 1

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( L> Qervice with a smile TZM"l;;"

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playees enjoy helping people. When a cus-tomer contacts EWEI3 for any purpose, the customer f is treated with courtesy and responsiveness.

A special way that EWE 13 demonstrates its desire to help customers is the " Customer Response Pro-gram." With every billing, customers are invited to write comments or questions on the back of the statement. When they include a phone number, they will be called by an EWE 13 employee. This program has been very successful in the early identification and resolution of problems, plus it has provided a more personal and positive contact with customers.

Nearly 15,000 questions, comments or requests for information have been written on the back of the bills during the past three years.

Another important way that EWEB serves its cus-tomers is through representing the customers' interest in response to actions proposed by the 13onneville Power Administration and other gov-ernmental bodies. The 130ard and staff diligently work to protect customers irom unjustified expense or unwarranted mandates. EWEl3 also provides leadership and support for the regional and national public power associations to assist their effectiveness.

l b Eugene Water & Electric Ikurd Anntul Re[x>rt

5 x 'v v c m-m denerms s t /aSte ROC EWElfs conservation pro- ma weineuyne w umormc and envin o-4VgV grams beneh,t the customers in two ways: p menu rewns.

1)They help customers reduce their energy use and, therefore, the size of their bills; 1- ~

2)They help assure an adequate and affordable  ;

_ .' ~' j energy supply for the future.  : -

During the past three years, EWEB and the llonne-ville Power Administration have invested nearly $10 million in the weatherization of more than 7,000 homes in EWElfs service area. This is resulting in an estimated 33 million kilowatt-hour reduction in an-nual electric use (or an annual savings in electric costs of about $1 million). EWEll is also providing comprehensive energy audits tbr commercial cus-tomers and has assisted local governments in get-ting llonneville funding to upgrade the efficiency of street and area lights.

EWEll continues to look for additional ways to help its customers conserve. Two new programs begun in 198-i are a $300 rebate (funded by Bon-neville) for residential customers who install solar or heat pump water heaters, and participation in a region-wide Super Good Cents program which enhances EWElfs existing program to encourage construction of energy efficient homes.

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'ON 711igh system CO Serve reiiasiiity, plentiful supply, low rates, responsive customer ser-m . vice, effective conserva-

"$x*1"."#$@ , i 3 \/e%31Mlylilg the 111orley tion programs and strong

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4 i EWE 13s financialintegrityhelps financial integrity create g 1 the utility provide better service. The the framework bv which

, ' budget provides adequate funding E W EI3 helps 'ugene E

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to maintain, upgrade and add to the prosper. As the commu-system in a timely, cost-effective nity grows, EWEB will manner without having to borrow money. When continue to provide the financing is required, EWEI3's quality bond ratings highest standards for keep interest costs down. service.

A major contributor to EWEB's excellent reputa-tion for fiscal management is the independent Board of Commissioners. The 130ard has the full authority over policy-making, budget approval and setting of rates. As a result, the utility's financial con-trol is totally separate from other City operations, preventing the possibility of compromising utility funds for non-utility purposes. ~,,m, 78 Still, EWE 13 provides considerable financial sup-port to the City. The City receives payments in lieu of taxes from EWEB which have doubled in the past

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five years. In addition, although EWEB has perma- f nently assigned its share of Trojan generation to the j/ 2 Bonneville Power Administration, EWEB's partner- [

ship in Trojan profits the City by about $1 million per /

l year. In total, the City received nearly $5 million ,

i from EWEB in lieu of taxes in 1984. Lg , pg Contributions in Lieu of Taxes O MIMMil Districts Other g city of rugene ,

O Toul H liugene Water & lilectrie lkurd Annual Report 2

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l 1he 1965 Board of Commis- 1 stoners is(from left)vice l' President Dennis Solin,

$arah llendrickson, Jack Craig. President Camilla Pratt andJames Reinmudt l )llli till'd ( II Ugi ill s !.lfgest puh!It !\ ( m hut l (111l11\ 1s .l llllle-( t illsililllilld . lilt l

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Camilla P. Pratt Commissioner "The User Group" of Ilusiness Practice and is a member of the Pratt was elected President of the Software. Oregon Academy's subcommittee Ik>ard inJanuary 1985 aftersening on medical effects of nuclear war as Vice President for six years. She Jack J. Craig Commissioner Craig and the nuclear rms race. Com-has sened on the lloard for eight has served on the lloard for six missioner llendrickson co-chairs years, and was elected in 19M to years representing the City at large. Eugene Physicians for Social Re-her third term (1985-88) repre- Ile first wun election in 1978 and sponsibility,is a memberof Eugene senting City Wards 2 & 3. She is a was re-elected in 1982 for a term Professional Women's Network, memberofadvisory committees to which expires the end of 1986. - andisnorthwest representativefor the Oregon Department of Trans- Commissioner Craig has served as the women's issues committee of portation and to the Eugene Parks an Oregon StateI.egislator and as a the American Association of Physi-

& Recreation Department, and has state kgislative administrator. lie cians for Iluman Rights. She has also chaired an advisory commit- was on the lane Transit District also found time to be a den leader tee for the Oregon Department of Iloard of Directors from 1973 to for Iloy Scouts of America.

Energy. Commissioner Pratt was 1978. Commissioner Craig has General 51anager of the Oregon been veryactive in the community. Dr. James E. Reinmuth Commis-510zart Players in 1984 while work- lie is a past president of the South sioner Reinmuth won ekction in ing toward a degree in Profes- Eugene Neighborh(xxl Associa- 1984 to serve the 1985-88 term of sional Office Administration from tion, past president of the lane office representing City Wards 1 &

Sierritt Davis ilusiness Colkge. County liealth Council and past 8. Since 1976, Commissioner Rein-president of the Edison School muth ha3 been Dean of the Univer.

Dennis L Solin Commissioner I'rA. A founder of the lane Demo sity ofOregon's School ofIlusiness Solin was ekcted Vice President of forum, he has sened as that or- Administration. Ile is a member of the Ik>ard in January 1985. Ap- ganization's moderator for 15 years. the American Institute for Decision pointed to the Ik>ard in 1982, he Commissioner Craig is a journalist Sciences, the American Statistical also won election that year to the and a freelance advertising and Association and the Institute for 1983-86 term ' representing City public relations consultant. Stanagement Sciences. lie has au-Wards 4 & 5. A certified public thored six books and numerous accountant, Commissioner Solin is Dr. Sarah Shideler llendrickson articles relating to strategic plan-a principal in the Eugene account. Commissioner iIendrickson has ning, forecasting, marketing plan-ing firm ofliabcock,Solin, Johnson served four years on the Iloard ning and leadership. Commissioner

& Oberlink. lie previously has representing City Wards 6 & 7. She Reinmuth is a dire tor of the Ore-sened as a commissioner for the first won election in 1980 and was gon Pacific Economic Develop-Willamalane Park & Recreation re-elected in 1984 to sene the ment Corp. and is a partner in both District and was a member of the 1985-88 term of office. Commis- the Rubicon Asset Stanagement lane County Parks Commission. In sior er llendrickson is a family Corp. and the Western Ilusiness addition to his memberships in physician with a private practice in Development Corp. Ile is also co-national and state associations for Eugene. A member of state and ownerof Production Technologies, accountants, Commissioner Solin county medical associations, she Inc., a manufacturer of sawmill is a member of thelane Council of has chaired the county associa- equipment and commercial trail-Governments, a member of the tion's community heahh commit- ers, and has served as a 3trategic Eugene Chamber of Commerce's tee and has been a member of its planning consuhant for several energy committee, a board mem- executive council. She is a mem- companies. In 1981, Commissioner

., ber of the Rubicon Society,a mem- ber of the American, Oregon and Reinmuth was campaign chairman her of Roundtable of Eugene and lane County Academies of Family for United Way ofinne County.

the northwest director of Tt*G, 10 Eugene Water & Eledric Iloard Annual Report

i l

I l

l 1985 Management The retirement -

MO Rosemary Edwards lean of the general manager in 1984 and three of the accact. twe josomn. ix,,

four division directors in 1983 has led to several [""";"G"nT"' "'""' l management changes at EWEB. The "new" manage- j q ment team is not new to EWEB, however. The team consists of veteran EWEB managers who have been "

, l major contributors to the successful operation of 4 the utilitv. Y '.

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The lloard ap[mintedJean Reeder cash accounting and customer _.__ __

l in January 1985 to sene as acting services departments. _.m ,,

1. L l general manager / secretary while a Kenneth Rinard, director of the i nationwide search is conducted to operations & engineering division.

l select a successor to Keith Parks. joined EET.Il 36 years ago as a I f~ l

.N!s. Reeder served as assistant gen- mechanical engineer. In 1955, he p .. p l

cral manager beginning December was appointed water operations g i 1983, following four y ears as man- superintendent. .\1r. Rinard was g ager of the utility's expanding con- promoted to assistant director of \

servation senices and statf. 5he operations & engineering in 19~5, j joined EXEllin 1978 as planning & and to division director in 1980. ~

governmental affairs coordinator. The operations & engineering di- ,

.\ts. Reeder has been instrumental vision includes the hydroelectric in impros ing the planning pn> cess operations, electric operations, at IXEll and in developing the engineering, service, steam opera-utility's highly successful conserva- tions and water operations depart-tion programs. In addition, she has ments.

been one of EWElrs lead negotia- Rosemary Edwards, dirm 'or of tors on regional energy issues. the administrative servia , divi-Don vanderzanden, director of sion and assistant secretary. loined -

the accounting & finance division EWEll .!! years ago as secretan to { ' -

and treasurer, joined IXEll l~ the general manager. She was ap-l years ago as general accounting pointed assistant secretary to the '

manager. Ile sened as assistant iloard in 19~4. and was promoted i treasurer from 19~3 through 1983 to assistant to the general manager i

A certified public accountant, .\lr. in 19~6. .\ls. Edwards has been vander/anden has been honored active in the Administrative .\ tan-i by the Nortimest Public Power agement Society and has been Association for "outstandmg pro- president of that org.tni/ation's fessional perfornunce in utihty lane-Emerald valley Chapter The hnancial administration." The ac- administrative services division counting & finance dnision in. includes the property & insurance, i tiudes the general accounting, contracts & records, purchasing.

1985 I.cadership 11

e personnel & safety, energy edu- personnel. EWEll employees are cation and stores & materials de- experienced, averaging 11 years of partments along with the public service to EWEll. They are produc-information and governmental re- tive, steadily increasing the number lations functions. of customers senul per employ-Garry Kunkel, director of the ee. And they are community-power management division, joined oriented, receiving United Way's EWEll 20 years ago as an account- highest award for employee giv-ing clerk. lie was promoted to as- ing. EWEf! provides comprehen-sistant commercial managerand to sive training, quali:y equipment, project analyst prior to serving as modern technology and competi-rate manager from 1977 through tive wages and benefits to help as-1983. Mr. Kunkel has chaired the sure that the community receives Northwest Public Power Associa- the best from EWEll employees.

tion's rate committee and has been an international director of the Data Processing Management As-sociation.The power management division includes the energy con-servation, power resources, new generation development and rate administration departments.

Two div,isions also have assistant directors. Jim Ilrown, assistant di-rector ofoperations & engineering joined EWEll 21 years ago as an en-gineer. Ile received promotions in 1965 and in 1975, and served as civil & mechanical engineering supervisor from 1976 through 1983. Mr. Ilrown is on the board of directors of the National Society of Professional Engineers and is a past president of the Professional Engi-neers of Oregon. Dave Johnson, assistant' director of accounting &

finance and assistant treasurer, joined EWEll eight years ago as a staff accountant. Ile was promoted to administrative accountant in '

1978 and to general accounting manager in 1980. Mr. Johnson is a licensed public accountant.

EWEll has a tradition of em-ploying-and retaining-quality 12 Eugene Water & Electric Iloard Annual Report

5 9

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( "The Eugene Water & Electric Board re-

. - mains a well run, financially ' gaa***at=S ~==== 4 til lleVleWstable public utility, and both it:s electric and water rates remain among the lowest in

"**" d j the Pacific Northwest and the nation. . It is to EWElfs '

j credit that it has been able to continue to serve its ,

customers reliably and economically in the midst of changes in the Pacific Northwest power picture." ,

So reads the opening paragraph of the five-year .:

Inspection Report of EWEB facilities published in a December 1984 by Howard Needles Tammen & .

Bergendoff, EWElfs independent engineering firm.

The report goes on to say "EWEB is well positioned to fitce the future. Its cash position is strong, and it does not fitce large capital expenditures to expand its water or power system in the near future. . .

Judged on the bases of management, finances and >

system performance, EWEB has weathered the past five years well. It meets or exceeds all requirements stipulated at the time it issued its bonds."

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naan neanc see, e ri acuacoiui e centraiseru<e orner SySteill electricsales

- o E Total in 1984 reversed three cs consecutive years of # /'

decline by increasing NQQ, 3.6 percent to 2.04 bil-E_ lion kilowatt-hours. The "'ilh"n. or $i0 niiihon nuire ihan T j]t[gp gygggg))

in 1983.Thiswas principally due to / J growth in sales can be nonneville s 22-percent wholesaie Annual water sales attributed to economic powerincreaseinxovember1983 have fluctutated between d

.i, b 19" '. 7.1 and 8.4 billion gallons improvement for EWEB's $'j[.jj"'[i{o["l,l1i" Commercial Customers the record %~.Oubkilowatt de. during the past 10 years.

and to cold weather dur. ni nd reached in 1980. In 1984, EWEB customers Conservation continues to be a -

ing the fall months. high priority ofi>oth uWun and i,, used 7.63 bill. ion gallons EWEB served 503 more customers. The nuy-nack Weath- of water,500 million gal-crization Program and a special electric Customers, all ' " ""

lons more than in 1983 increase ofless than one percent. Average [.r""r s"dit .$ I[i ((S"'r .$i .$

annual residential use in 1984 was 16,570 being weatherized in 198 4. bring-kilowatt-hours, about 700 kWh more than in ing the grand total to .33 during 10 0 the 7a-c~s 1983 but well below the record 20,653 kWh nuy.past nackthree scars.

program. l'nder the the nonnevine '

/ 7s reached in 1971. Resenue from retail sales rose Power Administration and nWrii -

4.1 percent in 1984 to $5' million. contribute an average of better

• There has been no change in elec. than 'O percent toward the cost of tric rates since November 1982, so wratheri/ation. l.ow-income cus-2s f~.

the increase in revenue is entirelv tomers can have the entire weath-attributable to greater usage. Res; erization cost paid fi>r through a '_-

g L ",' "? g'je dential customers paid an aserage special program in cooperation ~^"

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$ 41.09 per month (or 2.98 cents with the lane County iIousing and E l per kilowatt hour) in 198i for Comomnity services Agency.

electricity. A program to replace neariv EWElis three hvdnielectric 11.000 street and area lights witti 80 8' ei' es ' u water sales projects generated 4M million energy efficient lighting was com-kilowatt-hours of electricity in pleted in 198 6. As a resuh of this [] Rc'identui 198a. just two million kWh sity of program. electricity used fi>r street Q $cnuals<nke Whu 198Ss total. The cost fi>r the Ig. and area lighting was cut nearly billion kWh purchased from the in half when compared with llonnesille Power Administration 19'9's usage.

and other utilities totaled $32.1 y

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l eteam system steam :n=yar;z, j '

system Customers useti 450 mil 'glygf*l;"g,'&,,

lion pountis of steam in 1984, just one "ad i-a="ed P erovid-ing a working environrnent ii million pouncis less than in 1983. Reve ireeorancnminain,nor if' . '~ t."3' = - '

enue from the in December 1986, the Board h.trassment.

141 steam Cus, of Commissioners approved a u" ' " '"w'" *"' N"" "

iomers tataleti *signedtoassurereliablesteam

$1.95 million. sen-ice for at least 10 more

.* years. The plan includes replacing parts of the fuel-l handling system and making other needed mechani-cal and safety improvements to the plant. The plan This ~ 2 percent increase can be auributed ro a pleasantly also calls for a series of five annual rate increases to dry July and August. only 310 more water customers balance t he steam o}wrations' revenues and expenses, ,

wcre served in 1984, an increase of one percent. Average and to price all steam usage at a level cost per unit. The annual residential use was 99,966 gallons,8,fXX) gallons first increase, elTective February 1985. raised rates an more than in 1983 but still less than in all but two of the average ofless than 10 percent to the maiority of cus-past 10 years. The peak one-day use in 198-i was 52 mil- tomers, and up to 25 percent for the larger.use custom-tion gallons, far from the record u). 4-nullion gallon peak ers u ho purchase steam at the low est unit cost. The new reached in 19~9. iates also include a monthly fuel-cost adjustment to en-Revenue from sales increased 2.1 percent to $6.2 mil. sure proper pricing with respect to actual cost of fuel, lion in 198 i Sales to general service customers showed a the largest component of steam production expense.

detline in revenue of 1.5 percent because the City of Eugene ceased paying in mid-1983 an assessment based on the cost of installing oversi/e mains for fire protec-tion. Residential customers paid an average of $8 90 per ,

month (or $10' per ljxW) gallons) in 1984 for water.

Water rates have not been changed since Februarv 1982.

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1 198 4 in Resiew li

w Improved customer a newbiiiingcor. m ~~W:

COmmun1 Cat 10nS mat was developed in ==- sx.n_

1984 aimed at helping customers clearly under-

===- -

stand their usage and charges. EWEB bills can be T :- e 2-complex because most include charges for several --- . own _

utility services, includ- Thenewformatwasdesignedfollowing E" uwN c2.r ing the City of Eugene's thorough analysis of the questions gjiliF _i Ill received from customers about their ai sewer charge. bills and usage. It gives a detailed - - - - -

breakdown of usage and charges for each sen ice in easy-to-understand i=tmima w N s m ed terms, and has other useful information (such as average outside tem- amW50 4 perature) to help customers make meaningful comparisons of their " '"f ",',,

[ ' ,~~~,_*=--- M - 3 current bill with the previous month or year.

The new format has been very well received by the customers. There have been substantially fewer questions about the billings. Those that do arise are better focused and can be more quickly resolved.

Iw4 L1._s rir + 3)g Class of Service Customers Kilowatt-hours Revenue Residential 55 710 +0.8% 923 091 568 +5.5% $27 468 910 +4.9%

GeneralService 6 686 + 0.8% 608 683 326 +6.8% 17 452 135 +6.2%

I;argeCommercial& Industrial 26 + 4.0% 494 725 239 -3.0% 1177547 - 0.8%

Street IJghting 8 5 012 547 -9.4% 98 954 -9.8%

Water t?tility 1 I1 742 268 + 1.9% 238 559 + 5.3%

Retail Electric Sales 62 431 + 0.8% 2 043 254 948 +3.6% $57034 035 +41%

Sale to other t'tilities 106 629 000 + 22.0% 2 756 045 + 14.6%

Total Electric Sales 2 149 883 918 +4.4% $59 7)o 080 + 4.5%

in .r. +,

Class of Service Customers I,000 Gallons Hevenue Residenttal 28 892 + 1.0% 2 888 225 + 10.3% $3 086 697 + 4.3%

General 5enice 4 920 + 1.0% 3 658 179 + 5.0% 2 561 966 - 1.5%

Water Districts 3 1 013 015 +7.0% 515 704 +6.6% ,

Electric l'tility I 90 445 + 5.7% 48 206 +4.8%

Total Water Sales 43 816 + l .0% 7 649 864 + 7.2% $6 212 573 +2.1%

16 Eugene \Wter & Electric lloard Am1ual Report

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EI.ECFR K'. ! FINANCIAL; l'> 0 A R D ! STATEMENT e

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EUGENE WATER & ELECTRIC BOARD l 500 East Fourth Ave./ PO, llox 10148 / Eugene, Oregon 97440 (503) 484-2411 l

Financial Statement Responsibility The management of Eugene Water & Elearic Ik >ard maintains a system ofinternal controls to meet its respon-sibility for the integrity and objectivity of its financial statements and to safeguard its assets. The financial statements were prepared in conformity with generally accepted accounting principles for public utilities and accounting requirements of the Federal Energy Regulatory Commission. They retled all adjustments which are, in the opinion of management, necessary for a fair statement of financial condition and results of operations.

Coopers & !.ybrand, independent certified public accountants, are engaged to perform an examination of the ik urd's li' uncial statements. The examination provides an objective outside review of management's responsi-bility to t eport operating results and financial conditions. Working with our internal auditors, they review and make tests, as appropriate, of data in(luded in the financial statements.

Trrasurer March 1,1985 To the lloard of Conunissioners of Eugene Water & Electric Iloard:

We have examined the financial statements of the Eugene Water & Eleuric floard for the years ended December 31, 198 e and 1983, w hich are included herein Our examinations w ere made in accordance with generally accepted audning standants and, accordingly, included such tests of the accounting records and such other auditing pro-cedures as we omsidered necessarv in the circumstances.

In our opinion, the aforementioned financial statements present fairly:

( l) the financial position of the Electric l'tihty and Winer l'tility of the Eugene Water & Electric Iloard at De-cember 31,198 i and 1983, and ihe resuhs of their operations and thanges in their financial position for the years then ended, and (2) the assets and liabilities of the Electric l'tility's General System and Trojan Project of the Eugene Water &

Elect ric Iloard at December 31,198 e, and the results of their operati ms and changes in their financial posi-tion for the years ended Ikcember 31,198 e and 1983 all in comformity w ith generally accepted accounting prmciples applied on a consistent basis.

6U Y' Eugene. Oregon March 1,1985

EUGENE WATER & ELECTRIC BOARD l

Electric Utility IIALANCE SilEET I)ecember 31,1984 and 1983 Assets 1984 1983 General Trojan Electric Total System Project Utility Utility Plant in service . 158 365 282 169 114 130 327 479 412 320 414 102 Irss-Accum. depreciation & amortization 62 516 726 17 433 792 79 950 518 72 514 768 95 848 556 151 680 338 247 528 894 247 899 334 Property held for future use . 1 687 029 1 687 029 1 687 029 Construction work in progress 5 650 423 5 650 423 5 477 621 Nuclear fuel,less accumulated amortization 1984-$38,302,263; 1983-$34,243,773 22 707 129 22 707 129 19 056 836 UTILITY PLANT . 103 186 008 174 387 467 277 573475 274 120 820 l

Ik>nd funds . 2 593 078 10 575 123 13 168 201 13 351 303 Reserve & contingency fund 2 000 000 2 000 000 2 000 000 Renewal & replacement fund 500 000 500 000 500 000 Construction fund . 2 892 358 2 892 358 2 611 999 Contract charge reserse fund . 6 665 948 6 665 948 6 000 000 Decommissioning reserve fund 207811 207 811 SEGREGATED FUNDS . . I2651386 12 782 934 25 43i318 24 463 302 i

Cash & temporary investments 18 107 921 9 398 352 27 506 273 24 541 444 Segregated cash & investments . 2 251 877 3 446 220 5 698 097 5 541 954 Receivables,less reserTes 1984-$225,689; 1983-$210f>69 9 245 426 282 746 9 528 172 11 144 877 .

Materials & supplies, at average cost 1 566 356 2 982 021 4 548 377 4 607 180 Prepayments & special deposits 352 129 441 089 793 218 789 533 CURRENT ASSETS 31 523 709 16 550 428 48 074 137 46 624 988 Advance refunding costs . 10 280 684 10 280 684 10 697 468 Deferred charges & other . 4 476 527 925 8m 5 402 331 47 4068 OTIIER ASSifl3. 4 476 527 II 206 488 15 683 015 15 471 536 8151837 628 $214 927 317 $366 764 9 45 5360 680 646 i

um,meum .ms me i ,>>n +m, _ ,

Equity & l.iabilities 1984 1983 General Trojan Electric Total System Project Utility Utility llalance at beginning of year 113 Gil 142 113 Gil 142 101 367 546 Net revenue for ihe year . 2 977 609 2 977 609 12 273 596 RETAINED EARNINGS I16 618 751 116 618 751 113 641 142 24 424 150 133 106437 157 530 587 162 154 270 LONG TERM DEllT Accounts payable . 7 936 815 15 353 296 23 290 111 12 000 388 Accrued payroll & vacation pay . 842 271 842 271 899 545 Accrwd interest on long term debt . +18 692 2 613 809 3 062 501 3 135 410 long-term debt due within one year . 1 421 000 2 755 000 4 176 000 3 860 000 I

10 648 7"H 20 722 105 31 370 883 19 895 343 CURRENT LIAllllJTIES .

OTIIER LIAlllllTIES AND DEI' ERRED CREDI13 . 145 949 145949 146 723 DEFERRED TROJAN NET IllLLINGS 61 098 775 61 098 775 66813 168

$ 151 H37 62H $214 927 317 $366 764 945 $360 680 646 l

1

Electric Utility STATEMENT OF NET REVENUE For the Years Ended December 31,198-1 and 1983 1984 1983 Residential 27 468 910 26 182 036 Commercial & industrial 29 227 612 28 405 316 Sales for resale & other . 3 465 907 3 101 267 Steam heating 1 951 206 1 811 166 62 113 635 59 499 765 l OPERATING REVENUES .

Purclusett power 32 818 100 22 879 489 Steam & hydraulic production 2 371 377 1 789 126 Transmission & distribution 596631- 5 629 607 Customer accounting . 2 318 867 2 277 161 Conservation expenses . 1 580 884 13597%

Administrative & general 4 313 395 3 893 033 Steam heating expenses 2 121 898 2 554 767 Depreciation & amortization . 4 663 476 4 501 308 4 445 321 4 128 429 Contributions in lieu of taxes OPERATING EXPENSES 60 597 635 49 012 716 I 516(H)0 10 487 049 NET OPERATING REVEN1!E Interest earnings on investinents 3266835 2 621 595 Allowance for funds usal during construction . 163 600 160 800 Other nonoperating revenues . 128 391 372 293 OTIIER REVENUE 3 538 826 3 154 688 Preliminary surveys & investigations . 871 046 Interest expense & discount amorti/.ation . I 242 571 1407 341 Allowance for borrowed fund 3 usett during construction . (36100) (39 200)

REVENtiE DEDt!CTIONS . 2 077 217 136814i LTI'lLIW NET REVENt!E .

$ 2 977 609 $12 273 596 The xciwnpanying twwcs are an 6niegral part of this warement

Electric Utility STKfEMENT OF CIlANGES IN FINANCIAL POSITION For the Years Ended December 31,1984 and 1983 1984 1983 Net revenue for the year . 2 977 609 12 273 596 Charges not requiringcurrent funds 4 755 575 4 587 858 Depreciation & amortization 7 733 184 16 861 454 Prosided from operations

( Increase ) decrease in receivables, 920 702 (205 936) material bc prepayments -

8 653 886 16 655 518 TOTAL GENERAL SYSTENI .

Provided from operations-6 717 350 7 071 948 Depreciation & fuel amortization Change in accounts payable and other items-Net . 14 803 506 (673 168) 21 520 856 6 398 780 1

TOTAL TROJAN PROJECT .

30 174 742 23051298 TOTAL UTilllY FUNDS PROVIDED 4 549 779 7 450 835 l Additions to utility plant-Net 2 010 000 1 809 000 Long term debt paid or currently maturing .

280 359 209 305 Increase in construction funds Increase in contract charge reserve fund-Net 665 948 6 000 000 2 615 415 (2 847 449)

(Increase) decrease in current liabilities 80 719 369 402 Changes in other items-Net 10 202 220 12991093 TOTAL GENERAI. SYSTEM .

Additions to utility plant-Net 10 3'5 801 3 388 12' 132499 21 702 increase in other segregated funds 2 ~55 (X)0 2 645 000 1.ong term debt paid or currently maturing .

Increase (decrease ) in cash & temporary investments . 4 513 163 (l a99 982)

Deferred Trojan net hillings . 3 744393 1 843 933 21 520 856 6 398 780 TOTAL. TROJAN PROJECT 317230 6 19 389 873 TOTAI. trl'IlllY l'UNDS U5ED I N CRI!A SE ( D EC REASE ) IN G EN E RAl. SYSTEM

$( l 518 33 6) $ 3 66 6 425 CASII AND INVESTMEND The .a o wnpanyng ru weure an inttyral part of thn sutement.

Water Utility HALANCE SHEET December 31,1984 and 1983 f

Assets 1984 1983 Plant in service . . . . 43 602 947 43 061 830 Irss-Accumulated depreciation & amortization . 19 370 621 17 925 325 24 232 326 25 136 505 Propeny held for future use . . 100 316 100 316 Construction work in progress . 334 026 146 172 UTILITY PLANT . . .. . . .. . .. .. .. . . . . ... ... 21666 668 25 382 993 SEGREGATED BOND FUNDS . . .. .. . . 918 163 637 320 Cash & temporary investments . . 1 516 778 1 041 914 Segregated cash & investments . 1 856 864 1 824 364 Receivables,less reserves 1984-$ 18,034; 1983-517,711 . 662 192 680 937 Materials & supplies, at average cost . 263 331 284 735 Prepayments & special deposits . . . . 85 801 73 805 CURRENT ASSETS ... . . . . .. . . . .. .. 4 381966 3905 755 DEFERRED CilARGES AND OTIIER , . . . ... . .... 73 656 100 351

$30013 45j $30 026419 I

1 The auunpanpng nia s are an integral put of thn staterwnt.

Equity & Liabilities 1984 1983 14 579 280 14 511 634 lialance at beginning of year 434 297 67 646 Net revenue for the year .

15 013 577 14 579 280 RETAINED EARNINGS 12 430 352 12 894693 IDNG-TERSI DEllT .

Accounts payable 1 381 226 1 325 635 286116 298 363 Accrued payroll & vacation pay .

Accrued interest on long term debt . 449 703 455970 482 479 472 478 tong term debt due within one year .

2 599 524 2 552 446 CURRENT llAlllllTIES .

530 043 453 $30 026 419

n Water Utility STATEMENT OF NET REVENUE For the Years Ended December 31,1984 and 1983 1984 1983 Residential 3 086 697 2 958 036 Commercial & industrial 3 075 718 3 083 636 Other 57 970 _ 51667 OPERATING REVENUES. 6 220 385 6 096 339 Source of supply, pumping & purification . 895 933 897 404 Transmission & distribution 1 101 621 1 158 704 Customer accounting . 438 481 467 239 Administrative & general 1 091 607 1 001 818 Depreciation & amortization . 1 454 952 1 417 788 OPERATING EXPENSES , 4 982594 4 942 953 NET OPERATING REVENUE I 237 791 1 153 386 Interest earnings on investments 248 869 259 887 Allowance for funds used during construction . 18 800 16 730 OTilER REVENUE 267 669 276 617 Interest expense & discount amortization . 1 087 363 1 117 105 Allowance for borrowed funds used during construction . (16 200) (18 270)

Inss on negotiated settlement . 263 522 REVENUE DEDUCTIONS . 1 071163 1 362 357 UTil.rlY NET REVENUE $ 431297 5 67 646 The accompanying tu wes are an integral part of this statement

i Water Utility STATEMENT OF CIIANGES IN FINANCIAL POSITION For the Years Ended December 31,1984 and 1983 1984 1983 434 297 67 646 Net revenue for the year .

Charges not requiring current funds 1 466 020 1 432 265 IApreciation & amortization 1 900 317 1 499 911 Provided from operations Decrease in receivables, materials & prepayments . 28 153 310 472 26 695 (50 496)

Change in other assets-Net .

47 078 857 223 Increase in current liabilities .

2 002 243 2 617110 TOTAL FlINDS 1*ROVIDED ,

749 695 578 870 Additions to utility plant-Net 313 343 548 350 Increase in segregated cash & Imnd funds 464 341 472 478 lung-term debt paid or currently maturing .

1 527 379 1 599 698 TOTAL FtJNDS USED .

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$ 474 864 5 1017412 INCREASE IN CASII AND INVESTMENIS lin accomgunying notes are an integral pan of this st.atemetu.

NOTES TO FINANCIAL STATEMENTS December 31,1984 Summary of Significant Accounting Policies:

GENERAINIhe Eugene Water & Electric Ikiard, an administrative unit of the City of Eugene, Oregon, is re-sponsible for the ownership and operation of the electric and water utilities. It has the authority to fix rates and charges for commodities or services furnishul.1he ik urd's policies conform to generally accepted accounting principles for public utilities and the accounting requirements of the Eederal Energy Regulatory Commission.

Signincant policies are described below.

UTILITY PIANT AND DEPRECIATION-l?tility plant is stated at original cost. Cost includes labor, materials and relatul indirect costs such as engineering, transportation and allowance for funds used during construction.

The cost of additions, renewals and betterments is capitalized Repairs and minor replacements are charged to o,erating expenses.

'the cost of property and removal cost, less salvage, is charged to accumulatal depreciation w hen propeny is retis al.

Depreciation is computed using straight-line composite rates w hich are equivalent to approximately 3.1% of Ihe Electric Utility General System and 3.4% of the Water 1:tility original costs of depreciable utility plant. Depre-ciation for the Trojan Plant is computed using the 6% sinking fund method based on a 33-year plant life-INVESTMEN1b-investments, principally in U.S. Government securities, are carried at amortized cost plus accrued interest which approximates market.

OTilER ACCOUNTING POI.lCIES-Debt premium, discount and expenses are being amortized over the terms of the respe tive issues. Nuclear fuel amortization is based on the quantity of heat produce I w ithout pro-vision for salvage value.

Inng-Term Debt: 1984 General System Revenue ik >nds Series A,81-60 issue,3-4%, due 1985-2001 14 563 000 Series C,8-1-66 issue,4.35%, due 1985 99. 2 755 000 Series D,8-1M issue,4.90%, due 1985-99 3 725 000 Series E,11-1-75 issue,5.75-6.50%, due 19853)O 3 525 (XX) 24 568(XX) less unamortized discount 143 850 24 424 150 Trojan Nuclear Project Revenue ik>nds, Series of 197 Serial Ik>nds,4.50-5.75%, due 1985-90 . 51260 (XX)

Term ik >nds,5.90%, due 2009 83 700 000 13 6 960 O(X) less unamortized discount 1 853 563 133 106 437 El.ECTRIC UTillIY LONG-TERM DEllT $ 157 530 587

l 1984 Water l'tility System Revenue ik>nds 100 000 3-15-62 issue,3.20%, due 1985-86 .

8-1-66 issue,4.35%, due 1985-99 1 730 000 8168 issue,4-4.90%, due 1985-99 1 390 000 121-82 issue,6.75-10.125%, due 1985-2002 . 9 330 000 74 493 Debt assumed through annexation,3.50480%, due 1985-90 12 624 993 194 141 less unamortized discount .

$ 12 430 352 WATER ITflLID LONG-TERM DEllT Total long-term debt requirements during the years 1986 through 1989 are as follows:

Electrie Utility Water Utility General Trojan Sinking Fund System Project Maturities Deposits 1 423 000 2 885 000 511 475 206 832 1986, I 285 000 3 015 000 462 534 189 627 1987 I 430 000 3 155 000 497 593 1988.

I 700 000 3 305 000 522 652 l 1989.

The ik urd h.ts obsenul, performed and fulfilhxl its covenants and obligations as required by resolutions authorizing the issuance of revenue bonds.

Trojan Nuclear Plant:

The lloard has assigned to Ikmneville Power Administration (I!PA) and other public agency participants its 30% share of the output from the Trojan Nuclear Plant. The lkiard will receive payments and credits (net bil-lings) equal to its share of all Plant costs, including decommissioning, spent fuel storage and debt sen-ice whether or not the Plant is operable or operating and notwithstanding the suspension, interruption, interfer-ence, reduction or cunailment of Plant output. Net billings may vary from expenses each year but are recog-nized in each accounting period only to the exte'at of current expenses. Since there is no effect on net revenues of the Electric l'tility, net billings and operating expenses are not included in the statement of net revenues. The accumulated excess of net billings over expenses is stated in the balance sheet as " Deferred Trojan Net llillings."

l Following is an analysis of changes in this account during 1984 and 1983:

1984 1983 Total net billings 42 550 000 30 157 741 3 009 815 2 695 334 Add interest earned 1.ess 23 542 650 17 938 426 Operation & maintenance expenses 6 717 350 7 071 948 Depreciation & amortization 10 640 878 1 135 443 Other fuel expense 8 403 330 8 551 191 Interest expense ,

DECREASE IN DEFERRED TROJ AN NET lilLLINGS . $(3744 393) $(l 813933)

Accounts payable and other fuel expense in 1984 include spent fuel storage charges of $8,980,782 for the ikurd's share of fuel used prior to April 7,1983.

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I Power Supply Resources:

The Ikurd annually receives approximately 20% of its power requirements from its own generating re- ,i sources and 80% from 111% and other agencies under contractual agreements expiring from 1985 to 2017. IlPA provided approximately 78% of the Ikurd's purchased power in 1984 (1983,60 % ).

Pension Plans:

Substantially all employees are covered under the State of Oregon Public Employes Retirement System

( PERS) plan, a contributory defined benefit plan, and supplemental retirement plans. Pension expense for 1984 was $1.927,278 for the Electric l'tility and $423,061 for the Water l'tility (expense for 1983 was $1,949,014 and

$427,832, respectively), including amortization of the unfunded liability for the present value of all past normal costs over a 30$ car period. The Ik urd's polig is to fund pension costs accrued. The date of the latest actuarial valuation of the PERS plan was December 31,1982 and the supplemental plans was December 31,1983. PERS does not alhicate unfundal liability, vested benefits or assets available for benefits Irtween the lloard and the City of Eugene; therefore, this information is not presented. For the supplemental plans, the actuarially com-puted present value of vested benefits was $3,832,273 and the net assets available for benefits was $2,100,473

( $3,028,632 and $ 1,961,'79, respectively, for 1983). The assumed rates of return used in determining the actu-arial value of vested benefits were 7.5% for the PERS Plan and 6% for the supplemental plans in both years.

Commitments:

During 1983, the Ik urd was a signatory to a residential consen ation agreement offered by llonneville Power Administration (IIPA) to all utilities in the Nonhwest region. The agreement provides substantial lll% funding of conservation measures in the Ikurd's setrice area. As a signatory, the ik urd is subject to a " contract charge" levial against all generating utilities for recovery of a portion of the conservation funds expended in the region.

The contract charge will be determined in the current and future llPA rate cases and will be payable over a 20-year period. Ilasai upon the lloard's slure of projet ted conservation funding available from 111%, the lloard in 1983 segregated $6,000,000 from current cash reserves to provide for the estimated maximum future annual contract charge payments during the 20-year period. Itased upon consenation expenditures to date, the amount to provide for the future annual contract charges would approximate $4.000,000.

111% is currently considering replacing the contract charge with cost sharing, wherein, participating utilities n ould share in the cost of conservation measures based on the percentage that the power purchased from 111%

f is to the utilities total power supply. Public hearings have been held and contract amendments providing for cost sharing will be offered pending the outcome of Ill%'s rate case. Should the cost sharing amendment be otTered and acceptal by the lloard, the segregation of funds would be removed.

Loss on Negotiated Settlement:

The method used by the lloard in determining the clurges to the City of Eugene for providing adequate facili-ties and water flows for fire protection was disputed by the City. In 1983, the ik urd accepted an independent en-gineer's recommendation and agreed to include these fire protection charges in its future water rate structure.

The ikurd accepted a lump. sum payment of $250.000 for all charges billed the City during 1982 and 1983, re-sulting in a $263,522 reduction of Water t'tility net revenue.

Reclassifications:

For comparability, certain 1983 amounts have been reclassified to conform with account classifications used in 1984. There was no effect on previously reported net revenue.

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1984 FINANCIAL STATEMENT c

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Keith Parks General Manager / Secretary (Retired on December 31,1984)

Jean Reeder Assistant General Manager / Secretary (Appointed Acting General Manager /Secretay onJanuary 14,1985)

Donald Vanderzanden Director, Accounting & Finance / Treasurer DavidJohnson Assistant Director, Accounting & Finance / Assistant Treasurer Rosemary Edwards Director, Administrative Services / Assistant Secretary Kenneth Rinard Director, Operations & Engineering .

James Brown Assistant Director, Operations & Engineering Owen Brown Chief Engineer Garry Kunkel Director, Power Management Windsor Calkins

~ General Counsel Coopers & Lybrand Independent Auditor lioward Needles Tammen & Bergendoff Independent Engineer / Consulting Engineer

' Schwahe, Williamson, Wyatt, Moore & Roberts Special Counsel Wood Dawson Smith & IIellman llond Counsel lazard Frtres & Co.

Financial Consultant l

Coates, Kenney, Gavazzi & Witt, Inc.

Consulting Actuaries k _ _ . -

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